BOPET Film Prices Fall in the USA Due to Declining Feedstock PET Costs
- 10-Jul-2023 6:01 PM
- Journalist: Rene Swann
During the first week of July 2023, the price of Biaxially Oriented Polyethylene Terephthalate (BOPET) Film in the USA experienced a notable decrease as market conditions fluctuated from stable to a bearish trend. The primary factor influencing this downturn was the downward price trend of the feedstock, Polyethylene Terephthalate (PET). Additionally, while the demand for BOPET Film remained stable, the market faced a surplus in supply, further impacting prices.
The USA witnessed a decline of approximately 4% in the price of feedstock PET due to low demand and decreased trading activities in the country. As a result, the price of BOPET Film in the US market decreased by around 0.5% during this week. PET trading was relatively subdued as the second quarter concluded and the third quarter began. Spot supplies were irregular, with most producers having already concluded the bulk of their June business. Some producers still had railcars for sale, with off-grade supplies more prevalent than prime. The upstream prices of Natural Gas and Naphtha, key raw materials for PET production, also witnessed declines of approximately 1.5% and 4%, respectively, further influencing the price trend for BOPET Film.
Although the demand for BOPET Film remained stable in the domestic market, the supply was high primarily due to lower raw material costs. This week, the downstream packaging industry, particularly shipping and food and beverage packaging, showed average performance. However, the surplus supply of BOPET Film in the country and moderate to low demand contributed to a decline in product prices. Packaging companies faced challenges in maintaining profitability as reduced sales volumes were observed.
The recent bank failures in the USA, including Silvergate Bank, Signature Bank, and Silicon Valley Bank (SVB), adversely affected consumer confidence and spending. The public's loss of confidence in the financial system led to cautious spending, particularly on non-essential items. Consequently, the packaging industry experienced lower demand for packaged goods, reducing sales volumes and potential revenue declines for companies.
Looking ahead, ChemAnalyst forecasts that BOPET Film prices may gain momentum during the second week of July 2023, primarily driven by seasonal demand during the summer period. Additionally, several scheduled temporary plant shutdowns for feedstock PET during the above said period may disrupt the supply of BOPET Film in the USA, potentially further elevating prices, and it will continue in July. Market participants may closely monitor these factors to anticipate future price trends and adjust their strategies accordingly.